Anthony Corporation reported the following amounts for the year: Anthony's inventory turnover ratio is:
$$\begin{array} { | l | r | }
\hline \text { Net sales } & \$ 296,000 \
\hline \text { Cost of goods sold } & 138,000 \
\text { Average inventory } & 50,000 \
\hline
\end{array}$$

Question

Anthony Corporation reported the following amounts for the year: Anthony's inventory turnover ratio is:
$$\begin{array} { | l | r | } 
\hline \text { Net sales } & \$ 296,000 \
\hline \text { Cost of goods sold } & 138,000 \
\text { Average inventory } & 50,000 \
\hline
\end{array}$$

Quizplus · Accepted Answer

The inventory turnover ratio is calculated as Cost of Goods Sold divided by Average Inventory. Thus, $138,000 / $50,000 = 2.76.

Anthony Corporation Reported the Following Amounts for the Year: Anthony's